The Spotify headquarters in Stockholm. Although subscription-based music services attract fewer users than ad-supported platforms such as YouTube, companies like Spotify pay artists far more to supply their work online | Jonathan Nackstrand/AFP via Getty Images

Commission sides with artists over tech giants in radical reforms

Juncker ‘is completely out of touch with how the internet works,’ said MEP Julia Reda.

STRASBOURG — The European Commission has a daring new plan to unify the Continent’s fragmented broadcasting market and force tech giants to pay musicians, publishers, and performers more for showcasing their creative work.

The once-in-a-generation reform published Wednesday would allow Europeans the option to buy any program that any broadcaster puts online. It would allow artists to negotiate with companies like YouTube or Soundcloud for a greater cut of their profits. And it would bail out publishers by allowing them to press news aggregators such as Google News for compensation.

“Artists and creators are our crown jewels,” President Jean-Claude Juncker said in his State of Union address here. “The creation of content is not a hobby, it is a profession.”

The expansive overhaul of copyright rules, which were last updated in 2001, is considered the most controversial ingredient of the Commission’s plan to create a single market for digital services. The executive branch would give consumers greater access to broadcasters’ online content, so citizens living in Latvia could buy access to Sky’s British broadcast of the English Premier League soccer matches, instead of hoping a Latvian broadcaster bought the rights to show the games.

The proposal is merely the end of the first round in the copyright fight: Now that the reforms have been ushered through the Commission, they will go to Parliament where MEPs will push their national interests.

And the critics were quick to react.

“He is completely out of touch with how the internet works. All this will do is stifle freedom of expression online,” said German MEP Julia Reda, who wrote a report on copyright. “This will hurt European publishers.”

Siada El-Ramly of consultancy EDiMA, which represents internet platforms, was even more pointed: “We’re disappointed on the proposal and it lacks ambition in terms of meeting the needs of the digital age. It focuses on the effective lobbying done by the publishing and music sector.”

The potential cost of lowering digital borders has sent shock waves through the media and entertainment industry. Some fear that by breaking down broadcasting barriers, consumers could shop around Europe for the lowest-priced entertainment, wreaking havoc on long-held business models: Content is typically cheaper in poorer nations.

“We’re concerned about the burden on innovation,” said James Waterworth, vice president of the Computer and Communications Industry Association.

The Commission would also force companies like Google and video-streaming serviceVimeo to disclose commercially sensitive details of the contracts they sign with large record labels and recording studios to show their content on platforms. Artists would then, in theory, have more information to strike better deals for their work, and resort to a new dispute-resolution mechanism.

Although subscription-based music services attract fewer users than ad-supported platforms such as YouTube, companies like Spotify pay artists far more to supplytheir work online. The Commission has described the disparity between two as the “value gap.”

Google has said its “Content ID” system prevents copyrighted material from being illegally uploaded by users. However, critics, including Reda, said the cost of these recognition technologies is prohibitive for startups.

“It is therefore necessary to guarantee that authors and rightsholders receive a fair share of the value that is generated by the use of their works and other subject-matters,” the Commission said in its proposal.

The Commission’s squeeze on internet platforms doesn’t stop there.

The executive arm will also introduce a so-called neighboring right. It would allow news publishers to seek payment from aggregators like Google and Reddit who link to their content. The measure, dubbed a “link tax,” would give journalism the same legal protection that other media sectors already have when their work is shared without permission.

“I want journalists, publishers, authors to be paid fairly for their work, whether it is made in studios or living rooms, whether it is disseminated offline or online, whether it is published via a copying machine or hyperlinked on the web,” Juncker said.

Although it doesn’t require news aggregators to pay more, it will give publishers more leverage and a stronger incentive to negotiate as a bloc.

The Commission also will give scientific researchers the right to process large quantities of data. Some researchers have been reluctant to deploy text and data mining because of fears over copyright violations.